I’ve started and deleted this post three times now. It’s galling. I know what I wanna say, but can’t say it the way I wanna. It’s important though, at least in my thinking. So here’s hoping the fourth time is a charm.
Back in the ’60’s I was the janitor for Dad’s real estate offices — all seven. Once a week, there I was, a high schooler arriving in my ’59 Morris Minor, later a Datsun pickup, cleanin’ up, and printing the new listings for the week. I soaked up immeasurable amounts of data, completely unconsciously, while listening to agents BS, or just shootin’ the breeze with them while emptying their trash, or waxing their desks. (when I could actually see their desks, that is)
His first ever office, located in East San Diego, is now a Mobil station. For those in SD it’s at 39th & El Cajon Blvd. The agents in that office turned out to be his version of the ’27 Yankees. Eight of them opened up their own companies, and the office only held 10. They were hard workers, kept their noses clean, and with one glaring exception, really cool guys.
They were Rainmakers. What passes as a Rainmaker today isn’t what it was then.
Let’s all agree what a Rainmaker really is, and what they do.
In real estate, a Rainmaker is one who consistently produces leads resulting in closed escrows. These leads are often handed over to those working under said Rainmaker. There are also circumstances in which a Rainmaker will create ‘rain’ for other businesses, creating a storm of synergistic dollars raining on all those who have strategically situated themselves directly in the path of the anticipated storm.
To be fair, and this is a subjective personal definition, Rainmakers produce business. Whether it’s used to benefit the Rainmaker’s team or not, it’s business produced by their efforts. The fact they may only be raining on their own personal fields is a false issue. I also maintain producing less than a deal a week, give or take, doesn’t make the agent a Rainmaker. 30 deals is indeed an impressive year, but a Rainmaker it doesn’t make. Of course, this is totally arbitrary on my part.
So what’s the point?
Minds far more prescient than mine, Sean Purcell and Mike Farmer come to mind, may have foretold our industry’s future. They differ in emphasis and style, but generally speaking, teams will dominate real estate. I’m biased to the extreme on this subject. I agree totally.
Full disclosure — I’m a Rainmaker, and have been since forever. Frankly, I had no choice, as I was raised to believe that was the way real estate was meant to be. I saw it in action as I emptied trash, waxed floors, and printed new listings on the AB Dick machine. If you weren’t a Rainmaker, or didn’t become one quickly, Dad wouldn’t hire you, or wouldn’t keep you. Period. He had no time for those constantly looking to the sky for rain created by others.
Dad used to laugh while telling folks, “The next dollar The Kid makes from a referral I give him will be the first.” When you worked for him, you made your own rain, or found a desk somewhere else. Being the boss’s son meant bupkis.
What he didn’t foresee was teams. Give him a break. The huge irony? His whole company was a gigantic team populated by nothing but Rainmakers. Imagine a team in a normal market, (Remember what that is?) with just 23-28 agents doing 1,000+ sides annually, year in and year out.
Our weekly office meetings were, uh, brief and to the point. They sometimes ended with him promising, ‘If you’re not fired by enthusiasm, you will be fired with enthusiasm.’ He thought it was hilarious.
Brown and Brown is undergoing moderate to extreme changes in our business model. Extreme at home, mild to moderate away from home. We’re leveraging our Rainmaking ability through these changes. I’ll be publishing these changes before long.
Meanwhile, if you’re a Rainmaker you know what I’ve been talkin’ about. If not, maybe it’s time for you to look for an up and coming team headed by a bona fide Rainmaker. Most agents today would benefit from a significant income increase by making that move.
Don’t wait for everyone to catch on. Either start rainin’ or join a team.
Mike Farmer says:
Good description of the changing real estate environment. I think the main point you’ve made is that non-producers need to be removed from the company, that just having a license is not good enough to make the cut, and should never have been good enough.
June 13, 2008 — 10:38 pm
Benjamin Bach says:
“Either start rainin’ or join a team.” AMEN
A 20 year veteran in the business gave up his private practice last year to join a team. The team he joined will *probably* clock in at #1 for Keller Williams in Canada in in terms of GCI for 2008.
Someone asked him why he would give up his ‘good business’ (making 60-80K a year on his own).
He said “I’d rather be a rich servant than a poor king.”
June 14, 2008 — 3:39 am
Ben Bach says:
Just curious Jeff – I see you’re alluding to a level or production that a Rainmaker reaches – a deal a week , per year minimum.
What sort of $$ Volume do you feel someone needs to do before they’re a MEGA or a Rainmaker ? 10m ? 20m ?
June 14, 2008 — 3:42 am
jay says:
I remember when I had the chance to join a team early on in my RE career. I couldn’t get myself to do it because I had to see if I could do it on my own. My income would have tripled and as I was in my 16 month of business you can imagine life was tough.
So I didn’t join the team–like an idiot–and life stayed tough for the next 5 years–haha.
By God’s grace I’m now raining, but it would have been a lot easier to hop on a team for a few years. the question is if I had done that would I ever have found a way to make rain and enjoy the much higher corresponding income? I don’t know. If I had been busy enough in 2006 I wouldn’t have had time to create my first website–you guys will think this his hilarious, but it was a start from which I learned a lot: http://theorangeline.net/ Don’t laugh too hard at how homemade it is. I haven’t modified it in years. I don’t know how to that FTP stuff. Pathetic. Thank goodness for CMS systems (content management system).
To team or not to team–that is the question. In general joining a team is a fantastic idea early on in the career. Just be committed to building up your own online presence simultaneously….
June 14, 2008 — 3:56 am
Ken Smith in Chicago says:
@Jay – Teams can work great for new or established agents. There are plenty of very knowledgeable agents that are amazing at working with clients that suck at generating leads. Not every agent is cut out to be a rainmaker.
@ Ben – Volume in terms of total value of homes sold means nothing. Look at total transactions or better yet GCI if you can get the numbers. I know agents that sell multi million dollar homes only and sell $20 million in volume on 8 or less transactions that make less then an agent selling 30 $200k homes ($6 million to volume). Reason is the commission rate drops as the home price goes up, at least in our area.
June 14, 2008 — 9:24 am
Bawldguy Talking says:
Mike — It’s incorrectly invoked most of the time, IMHO, but this may really be a paradigm shift in RE brokerage.
Biz owners are now being forced to think of income & expenses just like any other industry. What a concept.
We’re already seeing it. Smallish firms with 20 agents working with 3-4 teams, are out producing 50 agent offices. More income, less overhead — it ain’t rocket science, is it?
June 14, 2008 — 10:52 am
Bawldguy Talking says:
Ben — What sort of $$ Volume do you feel someone needs to do before they’re a MEGA or a Rainmaker ? 10m ? 20m ?
It’s a totally arbitrary number, isn’t it? We both know agents who make a stellar living without a team. It’s about mindset too, isn’t it? There’s no Holy Writ setting a gold standard saying what a Rainmaker is or isn’t.
Speaking for my firm, we not only make rain for ourselves, but for other agents around the country. Though we’ve never made this part of our operation public, (a policy Brian Brady calls stoopid) we’ve rained on many different regions, making two of these agents six figures.
Maybe we should speak in degree. The agent doing 25 deals/year while earning $150K +/- is a Rainmaker, at least when it comes to their family, right?
I chose 50, ‘cuz the Rainmaker concept should retain it’s original meaning: Somebody who makes more crops appear at harvest time, than the average so called top producer. (Talk about a bastardized phrase.)
When those whose fields are watered by a Rainmaker are earning six figures, it’s probably safe to assume you’re dealing with a real live, old school defined, Rainmaker.
June 14, 2008 — 12:26 pm
Bawldguy Talking says:
Jay — For many teams, the benefit of the occasional emerging Rainmaker is a natural phenomena. The question is, will they stay, or form their own team?
Sounds like your learning curve has arrived at the balcony with a view. Your tenacity in persevering for five years is a testament to your work ethic and character.
June 14, 2008 — 12:29 pm
Bawldguy Talking says:
Ken — Your points are well taken.
>Not every agent is cut out to be a rainmaker.
Traditional broker/owners have taken decades to figure that one out. 🙂
June 14, 2008 — 12:32 pm
jay says:
I would say a true rainmaker generates 50 transactions+ year either for themselves or team members. With that definition I’m sprinkling. But I wouldn’t call $150,000 in commissions as even being sprinkling unless the average sales price is $200,000ish.
How about we call 30+ transactions as sprinklers and 50+ as rainmakers. Perhaps 100+ gets near the mega agent category. But some mega agents do 200+ so there are various degrees of that class. One step at a time I guess.
I’m wanting to make rain elsewhere geographically but it’s hard to find an agent(s) to team up with….Most think the idea of blogging my domain is nutty or that blogging is bizarre. Others who get it want to go the long route and do it on their own….
Bawldguy–if you have any suggestions on how to recruit agents to work with my vision of superteaming not bound by geography please email me directly.
I love reading you and Mike Farmer! This post was spontaneous, but if it is deemed inappropriate by Greg, just edit it our delete it. I will understand.
June 14, 2008 — 1:18 pm
Late Night Austin Real Estate Blog says:
I dont know if the future is teams. I think they might grow but I think the agent that has a strong sphere of influence and sells 8-15 properties a year will be around for a long time. In my experience a personal connection trumps advertising. So if the buyers wife has a best friend and best friend’s husband is an agent. That guy wont always get the business but he has a pretty good shot. Basically because going with someone else could cause personal issues with the friendship.
June 14, 2008 — 4:46 pm
Bawldguy Talking says:
I think the future is teams, but that surely doesn’t mean everyone’s on one. You’re no doubt correct that the sphere of influence contingent will hang around. They’ll lose business to teams though, big time.
Their wife’s friend? Though politics will always be a factor, ask yourself a question. How many ‘wives’ friends’ do you think list their homes with the Russell Shaw Group?
Plenty.
My experience shows overwhelmingly that dead presidents, expertise, and RESULTS trump, ‘but he’s my friend Honey’ more times than not.
There will always be single agents, but over time the teams will dominate their markets.
June 14, 2008 — 7:27 pm
Ken Smith in Chicago says:
There is no question that many people do not work with friends and family. I have a client who has purchased and sold 8 properties with me over the last 5 years which has an aunt in the business and 2 friends. Can give you plenty more examples including 3 current listings.
Just because a seller knows someone in the business does not mean they will work with that person. The person still has to prove they are the correct person for the job.
June 15, 2008 — 10:05 am